The Truth About Cars » car saleshttp://www.thetruthaboutcars.com
The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news.Fri, 20 Mar 2015 17:19:42 +0000en-UShourly1http://wordpress.org/?v=4.0.1The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news.The Truth About CarsnoThe Truth About Carseditors@ttac.comeditors@ttac.com (The Truth About Cars)2006-2009The Truth About CarsThe Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news.The Truth About Cars » car saleshttp://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gifhttp://www.thetruthaboutcars.com
Chart Of The Day: GM’s Gradual Car Sales Decreasehttp://www.thetruthaboutcars.com/2015/03/chart-day-gms-gradual-car-sales-decrease/
http://www.thetruthaboutcars.com/2015/03/chart-day-gms-gradual-car-sales-decrease/#commentsSat, 14 Mar 2015 12:48:48 +0000http://www.thetruthaboutcars.com/?p=1020753GM passenger car volume decreased 15% through the first two months of 2015 in the United States, tumbling by more than 18,000 units, or 21%, in February alone. With vastly improved U.S. pickup truck volume, steadily growing full-size SUV sales, and growth from the brand’s crossovers, GM was easily able to overcome the car deficit […]

This chart doesn’t showcase volume or year-over-year change, but it does show the decreased importance of GM car sales in America since the beginning of last year. For the record, rewinding ten years to the 2005 calendar year reveals GM’s car share to be just above 40%. In 2010, it was ever so slightly below 40%.

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures.

]]>http://www.thetruthaboutcars.com/2015/03/chart-day-gms-gradual-car-sales-decrease/feed/49January 2015 Sales: Buick’s Cars Bring The Brand Downhttp://www.thetruthaboutcars.com/2015/02/january-2015-sales-buicks-cars-bring-brand/
http://www.thetruthaboutcars.com/2015/02/january-2015-sales-buicks-cars-bring-brand/#commentsThu, 05 Feb 2015 14:00:26 +0000http://www.thetruthaboutcars.com/?p=993906Rough starts do not invariably lend credence to the belief that 2015 will be full of doom and gloom. Although January accounts for 8.5% of a calendar year, the month was responsible for just 6.7% of all new vehicle sales in 2013; only 6.1% of all new vehicle sales in 2014. For a number of […]

]]>Rough starts do not invariably lend credence to the belief that 2015 will be full of doom and gloom. Although January accounts for 8.5% of a calendar year, the month was responsible for just 6.7% of all new vehicle sales in 2013; only 6.1% of all new vehicle sales in 2014.

For a number of auto brands, however, 2015 could be difficult. At Scion, for example, sales fell 7% in 2013 and 15% in 2013, decreasing in 19 consecutive months before January 2015’s 8% year-over-year decline.

• Encore sales up 46.5% in January

• Regal falls into three-digit territory

• GM car sales down 7.3%

Jaguar volume slid 6% in January, a poor follow-up to 2014’s 7% drop. Although the XE will help, it’ll be a while before the brand’s new entry-level model actually lands. Smart is entering a transition phase, and the 6% drop in January to just 492 sales translated to the brand’s lowest-volume month since January 2013 and the second-lowest since November 2011.

Meanwhile, the 20% and 50% drops at Maserati and Bentley, respectively, equal slight volume decreases which could easily be made up in a single month at some point down the road.

But after 2014’s 11% increase – the fifth consecutive year in which annual volume has improved – and ten monthly YOY improvements in 2014, Buick sales slid 5.5% in January 2015.

Cause for concern? Likely not: Buick sales decreased slightly in January of last year, as well, and the year turned out to be one of significant growth. However, the specific areas in which the Buick lineup struggled are slightly more worrying.

Although it was made clear yesterday that TTAC is no fan, Encore volume predictably jumped 46.5% to 3465 units in January. It was the brand’s second-best-selling model behind the Enclave, which attracted only 32 more sales than its baby brother. Enclave sales were basically flat, down just 12 units compared with January 2014.

Buick car volume, however, tumbled by more than 1800 units, a 24.5% loss created by declines at all three car nameplates.

LaCrosse sales in America were down 29% to 2023 units in January.

At first glance, one might assume that big LaCrosse months at the end of 2014 (more than 10,000 LaCrosses were sold in November and December) downgraded inventory levels. But Automotive News reported more than 17,000 LaCrosses in stock at the beginning of January. It is entirely possible, however, that deal-making at the end of 2014 brought forward sales that might otherwise have occurred in the first-quarter of 2015.

Regal sales in America were down 45% to 792 units in January.

This was the first time monthly U.S. Regal sales fell below four digits since June 2010, the reborn Regal’s first full month on sale. GM possessed a 96-day stock of Regals at the beginning of January.

Verano sales in America were down 11% to 2776 units in January.

The Verano accounted for half of all Buick car sales in January 2015, down from 42% in January 2014. There was no shortage of available Veranos on dealer lots. Calendar year 2014 Verano volume was down 4%.

America’s car market hardly expanded in 2014, but there were signs of life in January. Eight of America’s ten best-selling cars reported improved sales in January. Chrysler, Dodge, Ford, Mazda, Mitsubishi, Nissan, Subaru, Toyota, and Volkswagen all generated improved January car sales, in addition to gains made by a number of premium brands.

Yet car sales trouble wasn’t a Buick-exclusive issue at General Motors last month. Although Buick was the most sorely impacted overall, Cadillac car sales slid 7%, but the brand was rescued by strong Escalade sales. Chevrolet car sales slid 5%, but light truck Chevys jumped 43%, propelling the brand to a 20% overall improvement. (GMC, remember, doesn’t sell any cars.) As a result, GM car volume was down 7% in January 2015, a month in which U.S. car sales jumped 8%.

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures.

]]>http://www.thetruthaboutcars.com/2015/02/january-2015-sales-buicks-cars-bring-brand/feed/76Chart Of The Day: Cars vs. Light Trucks Over The Last Decadehttp://www.thetruthaboutcars.com/2015/01/chart-day-cars-vs-light-trucks-last-decade/
http://www.thetruthaboutcars.com/2015/01/chart-day-cars-vs-light-trucks-last-decade/#commentsSat, 31 Jan 2015 13:50:21 +0000http://www.thetruthaboutcars.com/?p=991330After selling in virtually identical numbers in 2013, light truck sales in the United States overtook car sales in 2014 for the first time since 2011. Light trucks, a category which encompasses everything from pickups and body-on-frame SUVs to minivans and commercial vans to SUVs and very car-like crossovers, accounted for 52% of U.S. new […]

]]>After selling in virtually identical numbers in 2013, light truck sales in the United States overtook car sales in 2014 for the first time since 2011.

Light trucks, a category which encompasses everything from pickups and body-on-frame SUVs to minivans and commercial vans to SUVs and very car-like crossovers, accounted for 52% of U.S. new vehicle volume in 2014, up from 49.9% in 2013.

Passenger cars, a far more restrictive vehicle classification, achieved less than 2% year-over-year growth in the U.S. in 2014 even as the industry as a whole improved by 6%. Over the last decade, however, car volume was only twice superior to that of the 2014 level. Those two years, 2005 and 2006, also happened to be years in which light trucks outsold passenger cars. That trend came to an end in 2008, a twelve-month period which began a three-year span in which passenger cars would be the dominant force.

The light truck increase in 2014 can be divided into four groups. Pickup truck sales jumped nearly 7%. Commercial van sales rose 14%. Minivan volume was up slightly less than 5%. SUVs and crossovers overachieved with a 12% improvement to more than 5M units.

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures.

]]>http://www.thetruthaboutcars.com/2015/01/chart-day-cars-vs-light-trucks-last-decade/feed/109Tesla’s Tanking U.S. Sales And The World Of Automakers Falsifying Sales Numbershttp://www.thetruthaboutcars.com/2014/12/teslas-tanking-u-s-sales-world-automakers-falsifying-sales-numbers/
http://www.thetruthaboutcars.com/2014/12/teslas-tanking-u-s-sales-world-automakers-falsifying-sales-numbers/#commentsTue, 16 Dec 2014 13:00:55 +0000http://www.thetruthaboutcars.com/?p=958665The auto journo world is in a tizzy because electric automaker Tesla refuses to post its car sales numbers on a monthly basis and the numbers they do divulge are suspicious as they are without detail and they vary widely from actual registration numbers. Our friends at Jalopnik ranted about it last week, calling on Tesla to start […]

Tesla’s first fleet deal? Around 100 Model S’s were sold to a Las Vegas startup taxi service.

The auto journo world is in a tizzy because electric automaker Tesla refuses to post its car sales numbers on a monthly basis and the numbers they do divulge are suspicious as they are without detail and they vary widely from actual registration numbers. Our friends at Jalopnik ranted about it last week, calling on Tesla to start reporting sales consistently. They based their story on a report by Seeking Alpha that deduced that Tesla may have as many as 12,000 unsold Model S’s, based on registration figures and the automaker’s quarterly financial reports.

We say congratulations, Elon Musk, you truly are the head of an American car company now, as reporting bogus sales numbers to the press is a normal part of an automaker’s modus operandi. Auto manufacturers claiming they sold more cars than they actually did is nothing new. Sales numbers in the US are based on those deliveries reported by dealers, not when the automakers wholesale the vehicles to the retailers as some believe. Carmaker execs at times may be motivated to look good to their bosses or shareholders or to outsell a rival. They will then pressure, coerce and bribe dealers with one-time cash incentives to have them report bogus sales at month or year-end, often to the dealer themselves as loaner or demonstrator cars. The vehicles are never driven and then sold as new, ideally as quickly as possible as their warranty clocks are ticking. Dealers who do not comply are thus put in an unfavorable price disadvantage with competing same-brand stores.

The Japanese automakers pioneered this practice during the high-demand, low supply days. At American Honda from the 1970s to the early 1990s, dealers reported every unsold car as sold at the end of each month or they risked losing precious future allocations. Those were the days when every Honda dealership employee “bought” a dozen cars a year and then the dealer would turn to the white pages of the phone book to find more “buyers.” It is not an urban car legend that a California Honda dealer once sold Accords to customers named “Mickey Mouse” and “Donald Duck.”

In December 2012 BMW North America, in their zeal to beat Mercedes-Benz in the US, reported 37,399 vehicles sold, an amazing 69% higher than their 2012 average monthly sales rate, thus claiming the US luxury brand crown. That December the industry rose 21% over the 2012 average due to it being the heaviest incentive month of the year and this no doubt contributed to the rise in Bimmer sales. However, BMW dealers that I spoke with in January 2013 complained that half of their inventory had been reported as sold in December. BMW got tons of pub for beating Benz but few noticed that when actual registration numbers came out a few months later it was revealed that Mercedes-Benz outsold BMW for 2012. Incredibly, in one of the few occasions where the media sniffed out this practice, the Wall Street Journal had reported about BMW’s shady sales numbers just months before.

It was one thing to report cars sold as loaners or demonstrators under the direction of the factory; it is another to do report ghost sales when your dealership needs the incentive cash to stay afloat. We covered the story of a South Carolina Suzuki dealer who was convicted of fraud earlier this year for doing just that. It probably did not help his case that he was also convicted of a cornucopia of illegal advertising and finance practices.

As far as Tesla sales this year, here are the facts as near as we can determine: Automotive News has estimated Tesla’s reported sales in the US through October were 19,530 units. Actual registration numbers for the same period were 11,731 cars, a full 40% below the sales figures. Further, these registration figures show Tesla off 22% from the same period in 2013. Other sources have pegged the drop off at 26% this year. This may explain why Tesla may be dabbling in the fleet market for the first time, as pictured above.

Elon Musk responded to these reports by saying they are selling every car they build and his team issued a response saying that don’t report monthly sales because, “the media tends to read all sorts of nonsense into deliveries.” They also pointed out that a car could be sold one month and not registered until the next. Why, yes, just like every other automaker.

If GM or Ford stopped reporting monthly sales and started spewing such drivel, the press would vilify them but the rules are different for Musk. If he told the media that Tesla sold 200,000 cars one month, outsold all the other luxury carmakers combined and that he personally just got back from Mars, the slobbering press would not question him and resultant news stories would send Tesla stock into orbit.

Don’t get us wrong. We think that a new auto company selling 15,000 high dollar electric cars annually in the US through a unique, direct sales channel is an incredible accomplishment.

The Tesla Model S is one of the most innovative cars available today and Musk is one of this century’s greatest entrepreneurs, not to mention an amazing PR man. Who cares if can’t tell us the truth about how many cars his company sells?

]]>http://www.thetruthaboutcars.com/2014/12/teslas-tanking-u-s-sales-world-automakers-falsifying-sales-numbers/feed/167Lower Fuel Prices Not Slowing U.S. Car Sales At BMWhttp://www.thetruthaboutcars.com/2014/12/lower-fuel-prices-not-slowing-u-s-car-sales-bmw/
http://www.thetruthaboutcars.com/2014/12/lower-fuel-prices-not-slowing-u-s-car-sales-bmw/#commentsSat, 13 Dec 2014 13:01:10 +0000http://www.thetruthaboutcars.com/?p=958529Passenger car sales in the United States are up just 1% as the overall industry has grown more than 5% through the first eleven months of 2014. America’s two best-selling premium brands, however, are enjoying more encouraging passenger car numbers in 2014. Quickly decreasing fuel prices are not, as of yet, slowing car volume at BMW […]

]]>Passenger car sales in the United States are up just 1% as the overall industry has grown more than 5% through the first eleven months of 2014. America’s two best-selling premium brands, however, are enjoying more encouraging passenger car numbers in 2014. Quickly decreasing fuel prices are not, as of yet, slowing car volume at BMW in the least.

BMW car sales are up 12% through the first eleven months of 2014 on the strength of the 3-Series and 4-Series, which account for more than six out of every ten BMW passenger car sales. As the chart’s red line shows, the percentage of BMW’s volume generated by cars was as low as 59% in March, as high as 77% in July and 76% in October, but slid back somewhat to 67% in November.

Mercedes-Benz car volume is up 4.4% this year, although the brand’s cars tumbled 18% in October and 7% in November. Again, as the chart shows in the green line, Mercedes-Benz’s SUVs and crossovers accounted for 36% of non-Sprinter Mercedes-Benz volume in March, a figure which rose as high as 38% in May and 39% in October but fell to 37% in November.

We were clear about the reasoning behind charts like this a week ago, so we won’t go into the justification for displaying figures like these again. Are fuel prices a factor in pushing luxury SUV/crossover sales upward? Perhaps, but the numbers for these two top-selling luxury brands manifest little change.

And there are other contributing factors. Mercedes-Benz now sells their most affordable crossover, the GLA, which didn’t go on sale until September, and the new C-Class is only just beginning to play a role. Meanwhile, X6 volume dried up in August, September, and October as BMW USA waited for the new model to arrive.

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures.

]]>http://www.thetruthaboutcars.com/2014/12/lower-fuel-prices-not-slowing-u-s-car-sales-bmw/feed/21Nissan Defies Trends, Keeps Selling More Cars In Americahttp://www.thetruthaboutcars.com/2014/11/nissan-defies-trends-keeps-selling-cars-america/
http://www.thetruthaboutcars.com/2014/11/nissan-defies-trends-keeps-selling-cars-america/#commentsFri, 14 Nov 2014 13:09:40 +0000http://www.thetruthaboutcars.com/?p=944801In the steadily growing U.S. new vehicle market, car sales have increased just 1% through the first ten months of 2014. Nissan, however, says their car sales have grown 15.5% in 2014, surging forward by more than 90,000 units to 669,538. In calendar year 2013, total new vehicle sales were up nearly 8%, but car […]

Nissan, however, says their car sales have grown 15.5% in 2014, surging forward by more than 90,000 units to 669,538.

In calendar year 2013, total new vehicle sales were up nearly 8%, but car sales grew just 4% during a year in which, for example, pickup trucks were up 12%.

2014 hasn’t been so kind to cars, with the Chrysler Group’s passenger cars collectively falling 15%, Ford Motor Company car sales sliding 4%, GM cars up less than 2%, American Honda car sales up less than 1%, Hyundai car sales down 3%, total Toyota/Lexus/Scion cars up just 1%, and the Volkswagen brand’s cars down 12%.

According to Automotive News, in an industry that’s expanded by 720,125 units, total new passenger car sales are up by fewer than 77,000 units. Cars accounted for 50.6% of all new vehicle sales in the first ten months of 2013; just 48.5% in 2014.

That approximate 49% mark isn’t an unusual one for the auto industry in the United States. Americans are expected to register more than 16 million new vehicles in 2014, the first such 16K+ year since 2007, a year in which 48.8% of the new vehicles sold were passenger cars, down from 49.1%.

But Nissan is a much different seller of cars now than they were in 2007, when they sold 542,258 cars in the full calendar year, a figure which they eclipsed in the first eight months of 2014. (Nissan’s car division in 2007 was made up of a Z, Altima, Maxima, Sentra, and Versa. In addition to those five cars, Nissan now also lists the Cube, GT-R, Juke, and Leaf among their cars.)

Setting aside the historical significance, though, just look at Nissan’s current car performance, excluding the Juke for relatively obvious reasons. The brand’s car sales are thus up 16% to 635,517 units. 44% of that volume comes from the Altima, America’s fourth-best-selling car overall and third-best-selling midsize car. The Altima competes in a stagnant segment, but sales of this intermediate Nissan are up 3.4% in 2014. The brand’s two core small car nameplates, Versa (which includes the Note in Nissan’s release) and Sentra, combine to sell about as often as the Altima, generating another 43% of the brand’s car volume.

The Versa, up 21% in 2014, is America’s leading subcompact. Sentra sales are up 44% in a competitive set that’s risen around 3% this year. The Leaf is Nissan’s fourth-best-selling car. Sales are up 35% to 24,411 units, making the Leaf America’s 66th-best-selling car in 2014, just behind the Hyundai Veloster; just ahead of the Ford C-Max. This leaves less than 2% of the brand’s car volume for the 370Z (up 13%), Cube (down 28%), and GT-R (up 9%), and another 7% for the Maxima.

Sales of the Maxima are up 9% in this run-out-the-clock year, a real rarity in a declining category of big, volume-brand cars. The Maxima sells slightly more often than the Buick LaCrosse; slightly less often than the Chrysler 300.

These car nameplates have generated 59% of the Nissan brand’s year-to-date sales, up from 58% last year. Fortunately for Nissan, the Frontier, Juke, Murano, NV, NV200, and especially the Rogue have produced significant improvements, as well. Those vehicles, along with the declining Armada, Pathfinder, Quest, Titan, and Xterra, are up 11% to 436,947 units this year. Total Infiniti sales are up 4% to 93,925, 8% of the overall company’s volume.

And where does the Nissan brand rank in the grand scheme of automakers competing for passenger car sales in America this year? Automotive News says the Toyota brand leads the way, followed by Chevrolet, Honda, and then Nissan, which is nearly 17,000 sales ahead of FoMoCo’s Ford division. Of course, Ford has managed to sell 620,447 F-Series pickups this year, a massive figure which once again puts the car market into perspective.

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures.

]]>http://www.thetruthaboutcars.com/2014/11/nissan-defies-trends-keeps-selling-cars-america/feed/96Can The TLX Restore Acura’s Car Business?http://www.thetruthaboutcars.com/2014/09/can-tlx-restore-acuras-car-business/
http://www.thetruthaboutcars.com/2014/09/can-tlx-restore-acuras-car-business/#commentsMon, 22 Sep 2014 12:17:48 +0000http://www.thetruthaboutcars.com/?p=913394U.S. sales of passenger cars at the Acura brand are down 32% through the first eight months of 2014, yet total Acura brand volume is down just 3%, a loss of 3264 units. Acura’s trio of crossovers, including 66 sales from the cancelled ZDX, have improved 20%, a gain of more than 12,000 units, not […]

]]>U.S. sales of passenger cars at the Acura brand are down 32% through the first eight months of 2014, yet total Acura brand volume is down just 3%, a loss of 3264 units. Acura’s trio of crossovers, including 66 sales from the cancelled ZDX, have improved 20%, a gain of more than 12,000 units, not quite enough to offset the car division’s 15,552 lost sales.

It’s a tough year on which to judge Acura’s car output. Acura is replacing the TL sedan, TSX sedan, and TSX wagon with a single model, the TLX sedan. The TLX operates in a broad and rather affordable price spectrum, with four and six-cylinder powerplants, front or all-wheel-drive, and eight or nine-speed transmissions.

But this year’s car sales decline at Acura is nothing new. Moreover, it stretches beyond the disappointing sales of the disappearing TL and TSX.

ILX sales are down 18%; RLX volume is down 5%. Acura car sales slid 10% in 2013 after a 19% increase in 2012, which followed 2011’s 8% loss, 2010’s 1% increase, and consecutive declines in 2006, 2007, 2008, and 2009. Acura sold 151,662 passenger cars in 2005, when the brand’s U.S. market share was 1.23%, but didn’t sell that many total vehicles in 2012. Acura car sales in 2013 were down 56% from 2005 levels; down 16% from 2008.

Is the TLX the answer? We only have one month’s results on which to base our interpretation of the market’s reaction to the new car, so interpret we shall not. However, after a bit of a wait for cars to arrive, the TLX’s August sales results (2286 units) were better than anything the TSX, wagon-inclusive, has achieved in the last 27 months.

Even if the TLX quickly outshines the TSX, historic TL numbers will be much harder to match. TL sales declined consistently on an annual basis in 2006, 2007, 2008, and 2009, perked up very slightly in 2010, then declined in 2011, perked up slightly again in 2012, and then plunged in 2013. The slide has been so long in forming that we forget how popular a car it was. 78,218 TLs were sold in 2005; less than a third that many last year. Combined, Acura sold 113,074 TLs and TSXs in 2005. We’re not about to see the TLX make a return to those heights for Acura.

The RLX is far less popular than the RL was nine years ago, as well. Acura may sell 3800 this year. 17,572 RLs were sold in 2005, which preceded seven consecutive years of decline.

The RSX contributed an average of 19,915 annual sales in its three final full years: 2004, 2005, and 2006.

With help from those two lower-volume models, cars generated 70% of Acura’s U.S. volume in 2004, 72% in 2005, and 69% in 2006. Cars accounted for 41% of Acura’s U.S. sales in 2013, just 31% so far this year.

Acura is very much a crossover brand now. Acura sold 98,151 MDXs, RDXs, and ZDXs last year, the kind of total Acura hasn’t achieved with its cars in seven years. Compared with 2005, when the MDX was alone in Acura’s utility vehicle stable, Acura crossover sales in 2013 were 69% higher. Acura has already sold 73,375 MDXs, RDXs, and ZDXs in 2014, more than the total achieved by the brand’s crossover lineup in all of 2007, 2008, 2009, 2010, or 2011.

These aren’t just popular vehicles in comparison with Acura’s increasingly unpopular cars. The MDX outsells all premium brand SUVs and crossovers save for the Lexus RX. Sales of the RDX are down 2% in 2014, but it’s still outselling the Audi Q5, Mercedes-Benz GLK, BMW X3, and Volvo XC60. And it’s not as though all premium automakers (or premium wannabes) aren’t increasingly reliant on utility vehicles. BMW, for example, didn’t produce any SAVs in 1998, but in 2014 more than one-third of the brand’s U.S. sales involve an X1, X3, X4, X5, or X6.

Yet Acura’s steady rise in the SUV/CUV segment has not proved strong enough to maintain Acura’s position in the overall market. Acura’s market share in America was as high as 1.23% in 2005 and 1.15% in 2010, but Acura market share is down to 0.95% this year.

On its own, the TLX won’t replicate what the TL and TSX managed a decade ago. If the TLX can simply stop Acura from becoming an SUV-only brand, Honda’s crossover-centric answer to Land Rover or Jeep, we’ll say it achieved something meaningful, though perhaps not voluminous.

]]>http://www.thetruthaboutcars.com/2014/09/can-tlx-restore-acuras-car-business/feed/143Spanish Scrappage Scheme Now In Its Fourth Iterationhttp://www.thetruthaboutcars.com/2013/10/spanish-scrappage-scheme-now-in-its-fourth-iteration/
http://www.thetruthaboutcars.com/2013/10/spanish-scrappage-scheme-now-in-its-fourth-iteration/#commentsMon, 28 Oct 2013 17:25:46 +0000http://www.thetruthaboutcars.com/?p=636505The Spanish government is extending its own version of “Cash for Clunkers” for the fourth time, as Spain tries to boost sagging car sales in the midst of a severe recession. Buyers will get a 1,000 euro subsidy if they trade in a 7 to 10 year old car for a newer, more fuel efficient […]

Buyers will get a 1,000 euro subsidy if they trade in a 7 to 10 year old car for a newer, more fuel efficient one that costs less than 25,000 euro. The $97 million program will last for six months or until the subsidies run out, with the previous three programs helping to move 30,000 cars.

So far, Spain is the only country to initiate such a program – sales were up 29 percent last month, with the program credited for spurring much of the demand.

]]>http://www.thetruthaboutcars.com/2013/10/spanish-scrappage-scheme-now-in-its-fourth-iteration/feed/13Car Sales: Best July Since 2007, Almost Everybody Up, Truck Sales Yield Big 3 Market Share Gainshttp://www.thetruthaboutcars.com/2013/08/car-sales-best-july-since-2007-almost-everybody-up-truck-sales-yield-big-3-market-share-gains/
http://www.thetruthaboutcars.com/2013/08/car-sales-best-july-since-2007-almost-everybody-up-truck-sales-yield-big-3-market-share-gains/#commentsFri, 02 Aug 2013 10:00:43 +0000http://www.thetruthaboutcars.com/?p=497790The recovery of the auto industry in the U.S. continues with July sales being the best in seven years, up 14% from last year. Every domestic and foreign based automakers had increased year to year sales, with double digit gains at six companies. Leading the pack were Honda, Toyota and General Motors, with sales up […]

The recovery of the auto industry in the U.S. continues with July sales being the best in seven years, up 14% from last year. Every domestic and foreign based automakers had increased year to year sales, with double digit gains at six companies. Leading the pack were Honda, Toyota and General Motors, with sales up 21, 17 and 16 percent respectively. Ford, Chrysler and Nissan each were up 11%. Subaru, whose North American sales helped parent Fuji Heavy Industries to record earnings, had the best year to year performance, up 43%.

The seasonally adjusted annualized sales rate, SAAR, was just below analysts’ forecast at 15.7 million cars and light trucks. The strong July sales are expected to help total U.S. sales in 2013 to be the best since 2007’s 16.1 million units, analysts forecast 15.5. For the year through July, U.S. sales are up 8% industry wide.

In the actual sales race, the top five were led by GM with 234,071 units sold. Toyota was next with 193,394, just 314 units ahead of Ford. Honda was in fourth place at 141,439, with Chrysler close behind at 140,102.

As the housing and construction industries recover and the shale energy boom continues, pickup sales, Detroit’s bread and butter, have allowed the domestic brands to gain market share. GM’s sales of full size pickups were up 44%. All four brands at GM were up by double digits, with Cadillac and Chevrolet up 17% from 2012, Chevy’s best monthly year to year gain in over a year.

F-series pickups at Ford weren’t up as much as GM’s pickups, 23%, but they still outsold the Silverado and Sierra slightly with 60,449 units sold. Overall, Ford deliveries were up 12% while Ford’s luxury Lincoln volume slid 1%.

Nissan’s luxury brand, Infiniti, was also off, though by a much larger percentage, 33% but that was more than offset by a 17% increase in deliveries at the larger volume Nissan brand.

Chrysler deliveries were up for the 40th straight month, paced by strong Ram pickup sales. All Chrysler brands were up, including Fiat at 2%, except for the Chrysler brand itself, down 4% for the month. Jeep sales are down 4% for the year so far, due to the discontinuation of the Liberty and the slowed introduction of its Cherokee replacement.

Hyundai had a record July with 66,005 units sold and Mazda had it’s best gain in a year and a half, up 29% from 2012, on very strong sales of the CX-5 and CX-9 light trucks and an 18% increase in car sales.

Subaru also had strong sales for July, putting the company within reach of 400K units for the year and keeping it ahead of VW for the month, which was down 3%. VW did have some good news, with the brand’s heavily promoted TDI diesel engines having a big increase in take rate, up to almost 30% across the brand and nearly 40% for the Passat. Strong sales of the Q5 and Q7 SUVs paced sales at VW’s Audi brand, which were up 12%.

]]>http://www.thetruthaboutcars.com/2013/08/car-sales-best-july-since-2007-almost-everybody-up-truck-sales-yield-big-3-market-share-gains/feed/44The Car Sales Comebackhttp://www.thetruthaboutcars.com/2013/05/the-car-sales-comeback/
http://www.thetruthaboutcars.com/2013/05/the-car-sales-comeback/#commentsTue, 14 May 2013 12:00:01 +0000http://www.thetruthaboutcars.com/?p=488362Happy days are here again! April new car sales were up 9% from April 2012; which doesn’t sound like all that much until you realize that the winning brands beat losing brands by a near 5 to 1 margin. As for used cars sales, they are even better. Official stats for the used car market […]

As for used cars sales, they are even better. Official stats for the used car market are always hit or miss. But with large dealer networks such as Sonic Automotive, Carmax, Group One, and Asbury Automotive all recording double digit used car sales growth, it’s safe to say that the overall market for late model vehicles remains healthy.

And for all that good fortune, you can thank one overwhelming force in today’s marketplace.

The stock market.

The S&P 500 returned over 13% in 2012, while the NASDAQ Composite returned nearly 16%. As of 2013, both of these broad indices have already offered comparable returns for what amounts to only four and a half months of market activity. The S&P is up 14.5% from January 1st while the NASADAQ has registered a 13.9% gain.

Now the naysayers among you may only consider these returns as a minor sixteen month flash in a sea of chronic unemployment and low GDP growth. Fair enough. That is a fair assessment if we are talking about the broad overall economy.

But the average American is not a frequent buyer when it comes to new or even late model cars. In a land of nearly 200 million licensed drivers and just over 15 million new car buyers a year, there are only so many people who have the means to spend what amounts to $31,356 on average for a new car. Or even half that amount, $15,800, which coincidentally happens to be the average pre-tax and bogus dealer fee price for a four-cylinder 2011 Camry LE with 38,000 miles according to Manheim Auctions.

So never mind those stats. Who is buying those cars?

Older people for the most part. The average age for a new car buyer has increased dramatically from 43 years old in 2007 to 52 years old in 2012. This contrasts with a painful contraction of a nearly 30% decline for 18 to 34 year old buyers, and a 25% decline for the 35 to 44 year old group according to Lacey Plache of Edmunds.com.

Late model cars are harder to track. So I will admit my perspective on that side of the market is only limited by the guys I converse with at the auctions every week.

According to a lot of the professional buyers and used car franchise operators at these sales, the young are widely considered to be the ‘gawkers’. While the older folks are coming with spouse, and sometimes even well aged kids of their own, to put a sizable amount of money down on an expensive car.

And why are older people buying those cars (and trucks)? Not just because they have the money. But because they now have the confidence to take what is often a $30k+ plunge in overall wealth.

Let’s look a bit closer into the recent rear view mirror that are the S&P 500 and the NASDAQ Composite. Specifically, there are three recent facts about these broad investment indices, that reflect a steady change in the confidence level of the older new car buyer.

Both of these broad indices are up substantially from their pre-recession January 2008 numbers (S&P 11%, NASDAQ 29%). A lot of folks who were able to buy and hold throughout this period now have even more money than before the sub-prime mortgage crisis.

From 2009 thru 2012, both indices registered double digit annual growth for the entire time period with the exception all years except for 2011.

Not a lot of people have the means to take that deep breath of patience needed to stomach the volatility that comes with a severe economic crisis. Pensioners rarely have a choice, while those with 401k plans have far better investing flexibility.

But guess who is winning?

Nearly everyone who has invested in domestic stocks, virtually all domestic bond fund investors, the overwhelming majority of dividend focused investors, international indices speculators of varying types. Even those fortunate souls who have the means to invest their free capital into a personal business are finding sustainable gains.

Those who have the money, are now making even more money.

If you make enough money over a long-term period, perhaps enough to erase your gains and secure your return, you may just decide to reward yourself with an expensive car.

This is what now drives sales for new cars and late model vehicles. At least until the job market recovers.

]]>http://www.thetruthaboutcars.com/2013/05/the-car-sales-comeback/feed/51Analysis: Google Cars Gets Ready To Retail Rumblehttp://www.thetruthaboutcars.com/2013/03/google-cars-retail-sales-rumble/
http://www.thetruthaboutcars.com/2013/03/google-cars-retail-sales-rumble/#commentsWed, 06 Mar 2013 07:25:38 +0000http://www.thetruthaboutcars.com/?p=480094Google’s autonomous car program tends to get the lion’s share of attention when discussing the tech giant’s auto initiatives. But lurking in the background is a more immediate project that has the potential to finally “disrupt” (as Silicon Valley types are so fond of saying) online automotive sales. The last party to attempt such a […]

Google’s autonomous car program tends to get the lion’s share of attention when discussing the tech giant’s auto initiatives. But lurking in the background is a more immediate project that has the potential to finally “disrupt” (as Silicon Valley types are so fond of saying) online automotive sales.

What TrueCar did was distort the information asymmetry that car dealers rely on to make money. TrueCar was able to provide data on everything from dealer invoice to transaction prices and allowed dealers to compete with one another for a sale – a major taboo in the world of car sales.

Now, Google is rolling out a service, the imaginatively named Google Cars, beyond its initial Bay Area test market. Consumers will be able to log onto Google Cars and use the handy one-stop filter box (rather than clicking through various menus and sub-menus to boost a given site’s pageview count) and get inventory, pricing and retailer information for the exact car they’re looking for, down to the color. With 66 percent of dealer website visits arriving from Google, it only makes sense for the tech giant to try and capture some of that value. Under the Google program, users can shop for their cars via the first page of any given Google search. Google will get a minimum of $10 per lead, which is determined by a bidding system. One California Toyota dealer told Automotive News that he was paying $22 per car and $26 per truck or crossover, slightly more than the $20 paid to competing services.

Reviews have been mixed, according to AN. Some dealers like the flexibility of bidding for leads, while others expressed frustration that potential customers can contact dealers anonymously (via disposable phone numbers or email accounts, which expire after a set number of unanswered calls or emails), which they say diminishes the effectiveness of the leads.

Regardless of the potential issues, Google Cars cannot be ignored. Google’s massive size and resources will allow it to be far more aggressive than TrueCar ever was when interacting with dealers and OEMs. Regulators may be a thorn in Google’s side (never underestimate the lobbying power of NADA and other dealer bodies), but again, it has the resources to put up a proper fight against the usually dominant entities.

On a smaller scale, Google Cars is likely to cause a lot of headaches for the established players in the online auto retail spaces. Current juggernauts like Edmunds, Kelley Blue Book, Cars.com and even TrueCar are all threatened by Google Cars, thanks to the strength of the Google brand and most of all, the superior user experience. Once consumers know that they can access a high-quality car shopping tool without ever leaving Google and have the benefit of Craigslist-style anonymity it will be a tough sell for the other sites to get their customers back. About the only criticism levied at Google Cars in this area is the lack of content, like car reviews and automotive news. But Google has never been a content company and they are wise in avoiding this space. Better to aggregate the near-infinite amount of automotive content (aggregation is one of Google’s strengths, after all) that will likely be consumed by dedicated auto enthusiasts rather than consumers. A successful Google Cars could also cause indigestion further down the on-line food chain, at sites that live mostly off selling leads, and who dress-up the lead generation with content, which all too often is not their own.

Aside from the millions it should generate for Google, the car shopping tool is yet another way for them to collect data on consumer purchases. In this case, Google will amass significant personal information relating to what is likely the second largest purchase of one’s life, data that goes beyond whether you like a tan interior or a manual transmission. Google already can sense purchase intent from your browsing data, actively perusing a shopping service would confirm this intent. Yes, it’s ironic considering that Google subscribes to the idea that “information wants to be free“, but there’s a reason behind the internet adage “if you’re not paying for it, you are the product”.

]]>http://www.thetruthaboutcars.com/2013/03/google-cars-retail-sales-rumble/feed/18AutoNation’s Car Cassandra Warns Of Big Market Crashhttp://www.thetruthaboutcars.com/2013/02/autonations-car-cassandra-warns-of-big-market-crash/
http://www.thetruthaboutcars.com/2013/02/autonations-car-cassandra-warns-of-big-market-crash/#commentsMon, 11 Feb 2013 15:02:03 +0000http://www.thetruthaboutcars.com/?p=477178Automakers look with worry at the tanking European market, but have great hopes for an advancing American. Not so fast, says Mike Jackson, CEO of AutoNation Inc. He sees a day of reckoning follow a few years of good auto sales. “There is a day of reckoning coming for the U.S. economy and for America,” […]

“There is a day of reckoning coming for the U.S. economy and for America,” Jackson said at a J.D. Power conference in Orlando, with Reuters taking notes.

From 2004 to 2007, Jackson warned that automakers must stop producing too many cars, sold with generous consumer incentives and easy credit. In 2009, the U.S. auto market dropped to 28-year low after more than 10 years of sales that had averaged nearly 17 million. Now, he is warning of carpocalypse II.

Jackson said the federal monetary policies of low-interest rates and sharp increases in the balance sheet of the U.S. Federal Reserve are two major stimulus efforts that may come back to haunt American consumers.

Lacey Plache, chief economist for Edmunds.com, agreed with Jackson’s assessment, but like Jackson said it was difficult to peg the timing of the hit to the U.S. economy.

]]>http://www.thetruthaboutcars.com/2013/02/autonations-car-cassandra-warns-of-big-market-crash/feed/30Germany In September 2012: Brace For Impacthttp://www.thetruthaboutcars.com/2012/10/germany-in-september-2012-brace-for-impact/
http://www.thetruthaboutcars.com/2012/10/germany-in-september-2012-brace-for-impact/#commentsTue, 02 Oct 2012 12:36:59 +0000http://www.thetruthaboutcars.com/?p=462450For most of the year, the German new car market could defy Europe’s eye-popping g-forces. No more. Germany is now officially going down with the rest of them. With 250,082 units sold in September, German new car sales dropped 10.9 percent as compared to September last year. According to data released by Germany’s Kraftfahrtbundesamt, the […]

For most of the year, the German new car market could defy Europe’s eye-popping g-forces. No more. Germany is now officially going down with the rest of them. With 250,082 units sold in September, German new car sales dropped 10.9 percent as compared to September last year.

According to data released by Germany’s Kraftfahrtbundesamt, the German car market has reached its inflection point and is down 1.8 percent for the first nine months of the year. Formerly unaffected Volkswagen is down 20.1 percent. Opel is down 25.6 percent, Ford is down 22.5 percent.

If you want to see worse numbers, look for sales of EVs or hybrids. Out of the 2,358,798 car sold in Germany from January through September, only 2,023 were EVs and 15,771 were hybrids.

]]>http://www.thetruthaboutcars.com/2012/10/germany-in-september-2012-brace-for-impact/feed/6Pessimistic Predictions For China Worry Western Automakershttp://www.thetruthaboutcars.com/2012/03/pessimistic-predictions-for-china-worry-western-automakers/
http://www.thetruthaboutcars.com/2012/03/pessimistic-predictions-for-china-worry-western-automakers/#commentsTue, 20 Mar 2012 13:53:58 +0000http://www.thetruthaboutcars.com/?p=435653China has been the engine under record earnings at German automakers such as Volkswagen, Daimler and BMW. China helped GM offset its heavy losses at Opel, and provided more than 2 million cars that earned GM the (some say undeserved) title of world’s largest automaker. All of them have invested heavily into added capacity in […]

China has been the engine under record earnings at German automakers such as Volkswagen, Daimler and BMW. China helped GM offset its heavy losses at Opel, and provided more than 2 million cars that earned GM the (some say undeserved) title of world’s largest automaker. All of them have invested heavily into added capacity in China. All of them have reason to be worried.

Gu Xianghua, deputy secretary general of the China Association of Automobile Manufacturers (CAAM) said today that total vehicle deliveries in China may grow less that 5 percent this year. He cited a tepid GDP forecast and rising fuel costs that put a damper on China’s mass motorization.

Experts are very worried by Gu’s prediction that demand for commercial automobiles may drop by as much as 8 percent. Commercial vehicle sales are seen as a leading indicator, dropping commercial sales indicate a dropping economy. Says Gu according to Bloomberg:

“The slowing macro-economy will make it difficult to secure loans for commercial vehicles, restrictions on car ownership such as in Beijing, and car ownership costs such as fuel and parking fees are increasing. All these factors will have an impact on car buying in China.”

Automobile sales were down by nearly six percent in January and February. Gu’s remarks indicate that March might not be much better.

The cooling-off of the Chinese car market so far had the biggest effect on indigenous carmakers that sell to lower income customers. Joint venture makers increased their market share. However, luxury makers are beginning to feel the pinch. Says Bloomberg:

“Dealers for high-end car marques such as Mercedes Benz, Audi and BMW are dangling the biggest discounts seen since 2009 as competition intensifies and demand growth weakens.”

]]>http://www.thetruthaboutcars.com/2012/03/pessimistic-predictions-for-china-worry-western-automakers/feed/10Chinese Love Foreign Cars, Want Their Government To Drive Domestichttp://www.thetruthaboutcars.com/2012/03/chinese-love-foreign-cars-want-their-government-to-drive-domestic/
http://www.thetruthaboutcars.com/2012/03/chinese-love-foreign-cars-want-their-government-to-drive-domestic/#commentsSat, 10 Mar 2012 16:26:31 +0000http://www.thetruthaboutcars.com/?p=434484Western media widely reported (and still reports) that the Chinese government will only allow Chinese cars to be bought by its functionaries. Not so. The rule exists in draft form only,and has been published to elicit public feedback.However, in a disturbing development, China Daily reports that “nearly 90 percent of respondents in a survey are […]

If the survey is correct, then Chinese citizens want to look down on the car choices of their rulers. The Chinese themselves are widely in favor of foreign cars. 70 percent of all cars bought in China are foreign branded. The appetite for foreign branded cars remains high,as the following tables show.

]]>http://www.thetruthaboutcars.com/2012/03/chinese-love-foreign-cars-want-their-government-to-drive-domestic/feed/6TTAC Investigates: Why Japanese Suddenly Hate Carshttp://www.thetruthaboutcars.com/2011/10/ttac-investigates-why-japanese-suddenly-hate-cars/
http://www.thetruthaboutcars.com/2011/10/ttac-investigates-why-japanese-suddenly-hate-cars/#commentsTue, 04 Oct 2011 14:31:53 +0000http://www.thetruthaboutcars.com/?p=413431 Yesterday brought you news of the tepid Japanese car market that has been down 26 percent for the year. Commenter Alex Nigro DEMANDED the answer to “Are Japanese people still not interested in driving?” The Nikkei [sub] immediately went on the case and reports today that there is one segment in the industry that […]

The Nikkei [sub] immediately went on the case and reports today that there is one segment in the industry that is booming: Bicycles. Writes the Nikkei:

“The March 11 earthquake triggered an increase in the number of people who commute to work by bike, and new business are cropping up to accommodate this trend, including high-end park-and-shower services in central Tokyo.”

Two years ago, the Tokyo government started to promote commuting by bicycle. There even was a new word for the two-wheeled salary-man: “Tsuukin-isuto.” That spurred a mild trend, but not necessarily a craze of Japanese proportions. Did you ever had the pants of an Armani get into the chain?

Then, disaster struck. Millions of Japanese were stranded in downtown Tokyo on March 11 afternoon after the 8.9-magnitude earthquake closed down the sprawling mass transit system. “Suddenly, bikes became a lot more attractive to many people,” says the Nikkei. In a matter of minutes, bicycle stores were empty.

In the aftermath, saving power replaced Buddhism and Shinto as a religion in Japan. Salary-men were urged to ditch their blue suit and tie for “super cool biz” (short sleeves and open collars). Thermostats of the A/C were set to barely bearable, the nation perspired for a noble cause, and the bike race was on.

In short order, bikes turned into big business. Downtown office buildings opened high-tech full-service indoor bicycle parking operations: Racks for the bikes, showers, lockers. The monthly fees are steep: They range from $200 to $300 a month per bike. That approaches Manhattan fees – for a car. But in Tokyo, I get a free shower and don’t have to tip Gonzalez. I can also buy a bike for the same price.. A really cool bike.

The real craze in Tokyo is not the Roppongi daytraders that switched his Porsche for a Miyata (the bicycle.) The REAL craze in Japan is mamachari.

That’s a Japanese portmanteau of “mama” (mama) and “charinko” (bicycle): It denotes a utility bike with chainguard, fenders, rack, skirt guard, dynamo lights, baskets, and child carriers. It used to be to conveyance of choice of a housewife with two small children and shopping bags. Helmets? Who needs them?

]]>http://www.thetruthaboutcars.com/2011/10/ttac-investigates-why-japanese-suddenly-hate-cars/feed/41What They Really Drive On The Autobahn: Germany’s Top 50http://www.thetruthaboutcars.com/2011/06/what-they-really-drive-on-the-autobahn-germany%e2%80%99s-top-50/
http://www.thetruthaboutcars.com/2011/06/what-they-really-drive-on-the-autobahn-germany%e2%80%99s-top-50/#commentsThu, 02 Jun 2011 14:14:48 +0000http://www.thetruthaboutcars.com/?p=397124According to lore, Germany’s autobahn is teeming with S-Class, Porsches, and the occasional Veyron mixed in. Not so, says Germany’s Über-DMV, the Kraftfahrtbundesamt, in an article about the 50 top selling cars in Germany of 2010. “Upper class and sports cars are not in the Top 50,” say Germany’s keepers of car data. The truth […]

According to lore, Germany’s autobahn is teeming with S-Class, Porsches, and the occasional Veyron mixed in. Not so, says Germany’s Über-DMV, the Kraftfahrtbundesamt, in an article about the 50 top selling cars in Germany of 2010. “Upper class and sports cars are not in the Top 50,” say Germany’s keepers of car data. The truth is in the following table.

Germany’s Top 50

Rank

Make & model

Segment

Units 2010

Share

Diesel

1

VW GOLF, JETTA

Compact Class

251,078

8.6%

35.4%

2

VW POLO

Small Cars

96,945

3.3%

18.1%

3

OPEL ASTRA

Compact Class

72,685

2.5%

27.7%

4

MERCEDES C-KLASSE

Middle Class

71,871

2.5%

55.1%

5

BMW 3ER

Middle Class

67,643

2.3%

68.8%

6

VW PASSAT

Middle Class

66,496

2.3%

82.6%

7

OPEL CORSA

Small Cars

65,304

2.2%

5.0%

8

AUDI A3, S3

Compact Class

63,466

2.2%

45.1%

9

AUDI A4, S4

Middle Class

59,863

2.1%

76.8%

10

BMW 1ER

Compact Class

55,353

1.9%

53.9%

11

MERCEDES E-KLASSE

Upper Middle Class

54,111

1.9%

73.9%

12

FORD FOCUS

Compact Class

53,720

1.8%

36.2%

13

FORD FIESTA

Small Cars

51,598

1.8%

10.5%

14

MERCEDES A-KLASSE

Compact Class

51,579

1.8%

27.6%

15

SKODA FABIA

Small Cars

48,609

1.7%

11.3%

16

BMW 5ER

Upper Middle Class

46,014

1.6%

81.9%

17

VW TOURAN

Van

45,684

1.6%

63.2%

18

SKODA OCTAVIA

Compact Class

42,946

1.5%

54.8%

19

VW TIGUAN

SUV

38,687

1.3%

66.6%

20

MERCEDES B-KLASSE

Minivan

37,526

1.3%

39.9%

21

VW TRANSPORTER, CARAVELLE

Utility

36,691

1.3%

99.4%

22

OPEL MERIVA

Minivan

31,741

1.1%

12.5%

23

BMW Mini

Small Cars

31,477

1.1%

14.1%

24

HYUNDAI I 30

Compact Class

30,498

1.0%

22.8%

25

AUDI A6, S6

Upper Middle Class

30,079

1.0%

88.3%

26

VW CADDY

Utility

30,005

1.0%

68.0%

27

SMART FORTWO

Mini

29,065

1.0%

14.9%

28

OPEL INSIGNIA

Middle Class

28,208

1.0%

76.6%

29

RENAULT MEGANE

Compact Class

27,465

0.9%

40.6%

30

BMW X1

SUV

26,634

0.9%

82.9%

31

NISSAN QASHQAI

Minivan

24,148

0.8%

33.8%

32

PEUGEOT 207

Small Cars

23,994

0.8%

18.8%

33

FIAT PANDA

Mini

23,638

0.8%

5.5%

34

SEAT IBIZA, CORDOBA

Small Cars

23,570

0.8%

11.8%

35

AUDI A5, S5

Middle Class

23,415

0.8%

54.6%

36

RENAULT CLIO

Small Cars

23,333

0.8%

5.3%

37

AUDI Q5

SUV

23,148

0.8%

85.9%

38

RENAULT SCENIC

Minivan

22,677

0.8%

53.9%

39

TOYOTA YARIS

Small Cars

20,811

0.7%

5.0%

40

OPEL ZAFIRA

Van

20,750

0.7%

37.7%

41

FORD MONDEO

Middle Class

20,304

0.7%

76.3%

42

RENAULT TWINGO

Mini

19,648

0.7%

1.9%

43

SEAT ALTEA, TOLEDO, LEON

Minivan

18,668

0.6%

24.8%

44

FIAT 500

Mini

17,707

0.6%

5.0%

45

NISSAN MICRA

Small Cars

17,689

0.6%

1.5%

46

DACIA SANDERO

Compact Class

16,835

0.6%

7.7%

47

HYUNDAI I 10

Mini

16,703

0.6%

0.1%

48

CITROEN C3

Small Cars

16,619

0.6%

19.0%

49

SKODA SUPERB

Middle Class

15,450

0.5%

73.3%

50

PEUGEOT 308

Compact Class

15,376

0.5%

51.7%

Total Top 50

2,047,524

70.2%

42.3%

All registrations 2010

2,916,260

100.0%

41.9%

25 cars made up half of Germany’s sales last year. The Top 50 account for 66 percent. 42 percent burn oil. Electric cars? Hybrids? Do you see any?

]]>http://www.thetruthaboutcars.com/2011/06/what-they-really-drive-on-the-autobahn-germany%e2%80%99s-top-50/feed/39China’s Car Market: Bust Or Boom?http://www.thetruthaboutcars.com/2011/03/china%e2%80%99s-car-market-bust-or-boom/
http://www.thetruthaboutcars.com/2011/03/china%e2%80%99s-car-market-bust-or-boom/#commentsSat, 12 Mar 2011 13:40:16 +0000http://www.thetruthaboutcars.com/?p=387047Many pronounced the end of China’s torrid growth of car sales after they slowed to just 4.57 percent in February. Xing Huang, chairman of state-owned auto parts maker China Auto Parts & Accessories Corp (CAPAC), thinks otherwise. He expects the Chinese auto market to grow at the same speed in 2011 as in the year […]

CAPAC President Kangren Chen points at 150 million motorcycle owners in China who want to own cars. That actually is a good indicator. Once people have money, they change from 2 wheels to 4.

In the meantime, the car market in Beijing is in total disarray. As reported before, only 2,000 of the 20,000 license plates awarded in the lottery have been converted into car sales. The used car market has collapsed, because license plates are no transferable. A lot of people in Beijing expect the rules to change the soon the city can backpedal without a huge loss of face.

]]>http://www.thetruthaboutcars.com/2011/03/china%e2%80%99s-car-market-bust-or-boom/feed/10Hilfe! Huge Car Shortages In Deutschland!http://www.thetruthaboutcars.com/2010/10/hilfe-huge-car-shortages-in-deutschland/
http://www.thetruthaboutcars.com/2010/10/hilfe-huge-car-shortages-in-deutschland/#commentsSun, 17 Oct 2010 14:49:30 +0000http://www.thetruthaboutcars.com/?p=369126How things change. A few months ago, German dealers complained that the sky is falling, and that it’s the end of the car business as we know it – just because German cars sales had crashed from their Abwrackprämien-induced unnatural highs. Now, German car dealers have new reason to be worried: More buyers than cars! […]

How things change. A few months ago, German dealers complained that the sky is falling, and that it’s the end of the car business as we know it – just because German cars sales had crashed from their Abwrackprämien-induced unnatural highs. Now, German car dealers have new reason to be worried: More buyers than cars! Rationing! Come back next year!

Automobilwoche [sub] finds car shortages wherever they look. “Export successes are nice for the automaker,“ says a large VW dealer, “but my customers have to wait longer and longer for their cars, which endangers sales.” Implied criticism: Those bastards send their cars to China instead to their German dealers. What’s more, dealers are worried that they can’t reach their targets and will be cheated out of their year end bonus – not because they don’t sell enough cars, because the automaker can’t deliver.

The problem is rampant industry-wide. One item must be made clear before we look: The preponderance of made-in-Europe cars are made-to-order. You pick a car with all the details you want, they’ll make it for you. Takes about 4 weeks when everything goes normal. Currently, things don’t go normal.

Alain Uyttenhoven, head of Toyota Germany confirms that “there can be shortages with niche products that are not made in Europe, such as Land Cruiser, HiLux or HiAce. In the past months, our supply situation was not optimal.”

If you order a Daimler now, they promise you delivery by the end of the year, unless for „a few exceptions, such as SLS AMG, CL and CLS,” says a Daimler spokestress.

Over at BMW in Munich, „delivery times for models made in the US (X3/X5/X6) reach into the new year.“ If you order one now, you may get it in February 2011, if you are lucky. Want a new 5-Series? Some of them won’t be available until next year.

Ford has supply problems with cars with bigger bore diesel engines, for instance with the Mondeo, the S-Max or the Galaxy. The Thailand-made Ranger comes with a long wait.

Renault has problems with the Koleos: 4 months wait. All other cars can be had within 8 to 12 weeks, if you order now.

Delivery times at Volkswagen: Between 6 and 12 weeks, some models longer.

The only brand that has abundant cars: Opel. Opel sales boss Imelda Labbé told Automobilwoche: “All ordered cars will be delivered this year.”

]]>http://www.thetruthaboutcars.com/2010/10/hilfe-huge-car-shortages-in-deutschland/feed/3Chinese Car Sales: 17m This Year, 40m in 2020, 75m in 2030http://www.thetruthaboutcars.com/2010/10/chinese-car-sales-17m-this-year-40m-in-2020-75m-in-2030/
http://www.thetruthaboutcars.com/2010/10/chinese-car-sales-17m-this-year-40m-in-2020-75m-in-2030/#commentsMon, 11 Oct 2010 18:01:59 +0000http://www.thetruthaboutcars.com/?p=368226We are still waiting for the September sales numbers for China (at least we were spared the usual CATRC drama of faux numbers – maybe because there was a one week holiday?) But here comes something interesting (or shocking, depending on who’s side you’re on.) Auto sales in China could hit 17 million units this […]

We are still waiting for the September sales numbers for China (at least we were spared the usual CATRC drama of faux numbers – maybe because there was a one week holiday?) But here comes something interesting (or shocking, depending on who’s side you’re on.) Auto sales in China could hit 17 million units this year, up from 13.6 million in 2009, Chinese state media said today, citing the China Association for Auto Manufacturers (CAAM.) And that was the harmless part.

According to a Xinhua news report, brought to us by India’s Economic Times, because the Xinhua report can’t be found, the CAAM expects a rise of 25 percent to 17m units when the year is over. Xinhua also adds that sales of 17 million would equal the highest yearly figure ever reached in the United States. Rub it in boys, rub it in.

The CAAM is not known for wild projections. Actually, their guesses are usually on the conservative side. Like any good executive, they only make projections they already know they can and will reach.

They don’t have official numbers for September yet, but “last month sales are expected to be up by nearly 40 per cent over September 2009.” In that case, you bet they will.

Now, the Chinese government even has a formula for car growth: “The growth in the auto sector should be maintained at about one and a half times the growth in gross domestic product,” said Xu Changming, an official in charge of resource development at the State Information Center. Now consider that China gets sweaty palms if GDP growth is below 10 percent, and you’ll know how many cars they will sell. At the barest minimum.

Update: Automotive News [sub] reports that GM’s sales increased 15 percent in China in September. GM and its Chinese joint ventures sold 208,353 units last month. Ford’s China deliveries rose 26 percent in September to 50,970 units. While the Ford number is insignificant, the GM number isn’t. GM usually is a good indicator for the Chinese market. 15 percent for GM, and “nearly 40 percent” for the whole market is a serious divergence. Something must be off – again.

Industry monster SAIC, which runs joint ventures with GM and VW sold a total of 324,831 vehicles last month, up 23 percent. In September, SAIC’s JV with GM sold 100,825 units, up 41 percent. Sales at its JV with VW are up 36 percent to 95,869 units. (That’s not all of VW China, FAW has the other half.) What ruined GM’s data was Wuling. The maker of millions of delivery vans that made GM’s China numbers look good so far, suddenly reported flat sales, 101,290 units in September ‘10, versus 101,000 units a year earlier. That explains it the 15 percent overall number.

Over at state-owned Dongfeng, sales are up 22.3 percent from a year ago to 180,162 units sold in September. Dongfeng has JVs with Honda, Nissan, and PSA.

These numbers point to a good month, and make the 17m target very credible. China expects a rush in new cars in the last few months of the year. People don’t know whether the tax incentives for small cars will still be there next year, so people will buy this year instead of next.

]]>http://www.thetruthaboutcars.com/2010/10/chinese-car-sales-17m-this-year-40m-in-2020-75m-in-2030/feed/11Germany In May 2010: Car-Nagehttp://www.thetruthaboutcars.com/2010/06/germany-in-may-2010-car-nage/
http://www.thetruthaboutcars.com/2010/06/germany-in-may-2010-car-nage/#commentsThu, 03 Jun 2010 18:31:26 +0000http://www.thetruthaboutcars.com/?p=358012Remember carmageddon? It is not forgotten in Germany. As a matter of fact, Germany’s biggest carmageddon happened last month, in May. While champagne corks popped in the U.S., propelled by a 19 percent plus in May, the Germans are crying into their beers. According to numbers released by the German Kraftfahrt-Bundesamt (KBA,) the new car […]

Remember carmageddon? It is not forgotten in Germany. As a matter of fact, Germany’s biggest carmageddon happened last month, in May. While champagne corks popped in the U.S., propelled by a 19 percent plus in May, the Germans are crying into their beers. According to numbers released by the German Kraftfahrt-Bundesamt (KBA,) the new car market collapsed by heart attack inducing 35.1 percent in May. That’s not the worst part of the story.

The really bad part is that sales in May were 9.3 percent below the same month in the dark days of 2008. The graph above tells the story. Germany had averted carmageddon in 2009 by pumping massive amounts of Abwrackprämien (cash for clunkers) money into the market. Result: See red line above. In 2009, the German market jumped well over normal levels.

With the money missing, the market is going into serious withdrawal. See green line for 2010. Except for March, new car sales have been below 2008 levels for each month of the current year. The traditionally active spring selling season collapsed.

Have a look at January. When January 2009 sales disintegrated (red line) it spooked the German government into laying on the cash for clunker program. You see it working. Then sales dropped as the money was withdrawn. Many cars are built to order in Germany, there were waits for delivery. The amphetamines, prescribed in Berlin, took a while to work themselves out of the system. With the market drug-free, we are now below crisis levels. Will there be Abrwackprämie, the Sequel? Only people on real drugs think so.

There is no end in sight. The headlines will get worse through June/July. By the end of the year, the numbers will have caught up with the new reality. So far, this is worse than the most pessimistic pundits projected.

In the first five months of the year of 2010, Germans bought 1.179,532 cars. That’s 450.000 less than in the same period of the prior year.

Small cars, the darlings of the Abwrackprämien high, are nearly unsalable. That segment shrunk by more than half. The formerly eschewed upper classes and SUVs enjoy a come-back from near extinction and are the only segments with growth.

As far as brands go, Mercedes-Benz is he only winner of the May slugfest. Daimler grew by 6 percent, mostly due to the brisk sales of the new E-Class. Ashen faces in Munich: BMW lost nearly 15 percent. The so-called volume manufacturer were seen lining up at the drugstores of Rüsselsheim, Cologne, and Wolfsburg, from where antacid shortages are reported. Opel lost 51.5 percent, Ford gave up 45.9 percent, VW said good-bye to 34.1 percent of 2099 May sales.

The import brands didn’t fare better, some worse. The few gains are by boutique brands on such a low level, that it could well be numerical flukes.

Bad omen: Lancia, which is supposed to be merged with the Chrysler and Dodge brands, is at the bottom of the list in May, with only 133 cars sold. Lada sold more (178.)

As far as the German market goes, I never subscribed to the pull forward theory. There was nothing to pull forward. Owners of clunkers usually don’t buy new. They buy used, a younger clunker. The thinking was that by luring that usually new-adverse segment into buying new, the missing new car buyers could be replaced. They still are missing. As Germany gets older, they might never be back. What’s back is the used car market. Solidly (+13,4 percent) up again in May.

If you want to cry for Germany, or watch with glee the belated carpet bombing of the German market, then you may download the data in all their ugliness here. In German, but the numbers need no translating. They are abgrundtief schrecklich (abysmally appalling.)

]]>http://www.thetruthaboutcars.com/2010/06/germany-in-may-2010-car-nage/feed/12Car Execs Predict: 41m Cars Per Year In China 2015http://www.thetruthaboutcars.com/2010/04/car-execs-predict-41m-cars-per-year-in-china-2015/
http://www.thetruthaboutcars.com/2010/04/car-execs-predict-41m-cars-per-year-in-china-2015/#commentsMon, 19 Apr 2010 16:11:02 +0000http://www.thetruthaboutcars.com/?p=353183Whenever yours truly sings the long-term praise of the booming Chinese auto market, it elicits loud protests: “Can’t be! Bubble market! The environment! (Our gasoline.)” The people who make and sell cars for a living have a different opinion. The AlixPartners consultancy asked 50 senior executives from both foreign and domestic players in China’s automobile […]

The people who make and sell cars for a living have a different opinion. The AlixPartners consultancy asked 50 senior executives from both foreign and domestic players in China’s automobile industry how much they think the Chinese car market will grow between now and 2015. Guess what their answer is?

The 50 executives expect “steady growth of the Chinese auto market in the future, with a projected average sales growth of 20 percent per annum between now and 2015”, said John Hoffecker, managing director of AlixPartners.

20 percent ain’t much? Don’t forget the magic of compound interest.

If the 50 guys are right on, it will be 16m cars this year, 24m cars in 2012, 41m cars in 2015.

]]>http://www.thetruthaboutcars.com/2010/04/car-execs-predict-41m-cars-per-year-in-china-2015/feed/18Three Guys Discuss The Chinese Car Bubble Theoryhttp://www.thetruthaboutcars.com/2010/04/three-guys-discuss-the-chinese-car-bubble-theory/
http://www.thetruthaboutcars.com/2010/04/three-guys-discuss-the-chinese-car-bubble-theory/#commentsSun, 11 Apr 2010 14:27:35 +0000http://www.thetruthaboutcars.com/?p=352066I spent an interesting Saturday with two old friends of mine. They had never met before. One, American, CFO of an insurance company, had been in the finance and banking business all his professional life. The other, born Chinese, naturalized American. Was one of the top mortgage writers in the Silicon Valley before the dotcom […]

I spent an interesting Saturday with two old friends of mine. They had never met before. One, American, CFO of an insurance company, had been in the finance and banking business all his professional life. The other, born Chinese, naturalized American. Was one of the top mortgage writers in the Silicon Valley before the dotcom crash. Came back to China and heads a Chinese/American bank. The two got along splendidly.

Of course, we talked about money and cars. Recently, there was a discussion on TTAC on how the bursting of the Chinese real estate bubble would destroy the car market just like it had in the USA. I eagerly set out to pick their brains.

Quite oddly, the first one to throw water on the bubble theory was my friend, the staid CFO of the staid insurance company. He thoroughly debunked the myth that the American car bubble of 2000 was created by people who had come into money by flipping homes instead of burgers. He had one number right off the top of his head. “Each year, about a million homes change hands. Sometimes more, sometimes less. Even assuming they were all flippers, they didn’t buy 17 cars per home and year.” Instead, he said, it was easy credit that had driven up the sales of cars before it drove up prices of homes.

Need some cars to go with it? Picture courtesy newhomessection.com

Did the wealth effect, the feeling that you suddenly sat on a three million home that you had bought for $500,000 (with $100,000 down,) did that urge you to fill up that three car garage to its limit? No, said my friend, the staid CFO. Housing prices were relatively flat through the 90s while car sales increased. Car sales peaked in 2000, just when home sales started to skyrocket. Real estate taxes rose right with it, and those three cars turned into a liability. Car sales eased.

“Easy credit did cause the car and housing bubble. The credit crunch burst both bubbles. But the housing bubble was not the cause of the car bubble,” said my bean counting friend. If you look at the charts which I linked in this paragraph, you see that while doing it off the top of his head, he was right. The car boom in the U.S. preceded the real estate boom. Both crashed when the easy money was gone, or, as my beancounting friend put it, “when the hedge funds said to sell everything that’s not listed on the NYSE.”

He then went into a long monolog about high yield asset-backed-securities and credit derivatives that were en vogue with hedge funds. He did that much to the fascination of my Chinese friend, but I lost him.

About 60 skyscrapers in Beijing are vacant. Picture courtesy springcreekacq.com

When the discussion came to the Chinese real estate bubble, my Chinese banker friend emphatically acknowledged that China is in a huge one. Mostly in the tier one cities, but getting into the tier 2 cities also. He said that it is an absolute insanity. People buy homes and apartments, and keep them empty. Vacancy rates in tier one cities are sometimes higher than 30 percent. About 60 skyscrapers in Beijing are vacant. He congratulated me on my choice of renting, and suggested I should move, because rents are actually coming down. Caused by the oversupply of unsold properties, held for speculative purposes.

When they are poor, they take the bus or the train... Picture courtesy concierge.com

Coming to cars, my Chinese banker friend emphatically denied that easy money has anything to do with the skyrocketing car purchases in China. “That’s an American fantasy. Chinese don’t finance their cars. They pay with cash.” He told me how forays of his bank into the automotive financing field had failed, to the utter disbelief of his American partners.

The official party line is that “less than 20 percent of Chinese car purchases are financed.” My Chinese banker friend figures it might be less than 10 percent. “The number of financed cars is actually going down. Chinese don’t borrow to buy a car. When they are poor, they take the bus or the train. When they earn more, they buy a car.” He said that that Chinese increasingly earn more. About 25 percent of China’s 1.3b to 1.5b people are considered “middle class.”

… when they earn more, they buy a car. Picture courtesy popsci.com

Then, my Chinese fried mentioned the high savings rate of the Chinese, and that many of them don’t know where to stash their money. That got the fascination of my bean counting friend. They both bemoaned the lack of high yielding safe investments. When they started discussing yield curves, instead of the curves I am interested in, I lost them again.

We went for dinner, all three of us agreeing that in China, the boom in cars has nothing to do with the boom in real estate, that the two are much more disconnected than they ever were in the U.S., that the Chinese real estate market will go boom unless the government will intervene (very likely, as it is often state owned enterprises that are driving the prices up and are building the empty towers,) and that the car boom in China will last until the motorization has reached Western standards. In a country where cars aren’t financed, tight or easy money has little impact on car buying.

A level of motorization according to Western standards is about 600m cars away. So even if the Chinese would – horrors of horrors – buy 50m cars a year, instead of the 15-17m this year, China would have 12 years until the beginnings of a market saturation.

I asked both whether I should buy oil futures. They both shrugged, and we had the best Beijing duck in town.

]]>http://www.thetruthaboutcars.com/2010/04/three-guys-discuss-the-chinese-car-bubble-theory/feed/30China in January: Up 115 Percent. Or 126 Percenthttp://www.thetruthaboutcars.com/2010/02/china-in-january-up-115-percent-or-126-percent/
http://www.thetruthaboutcars.com/2010/02/china-in-january-up-115-percent-or-126-percent/#commentsTue, 09 Feb 2010 17:53:36 +0000http://www.thetruthaboutcars.com/?p=344819China’s passenger car sales in January skyrocketed an unbelievable 115.5 percent from a year earlier, China’s official scorekeeper, the China Association of Automobile Manufacturers said today. A total of 1.32m passenger cars were sold last month in China, compared with 610,600 units a year earlier. In December 2009, 1.1m units changed hands, Reuters reports. The […]

]]>China’s passenger car sales in January skyrocketed an unbelievable 115.5 percent from a year earlier, China’s official scorekeeper, the China Association of Automobile Manufacturers said today. A total of 1.32m passenger cars were sold last month in China, compared with 610,600 units a year earlier. In December 2009, 1.1m units changed hands, Reuters reports. The January number is even more surprising as the China Passenger Car Association had originally figured that China’s passenger car sales rose 84 per cent in January. We compared the Reuters story with Xinhua, the official word on China, and Xinhua also says: “Passenger car sales were up 113.21 percent to 1.32 million units last month.”

Overall vehicle sales, including buses and trucks as well as cars, were even more amazing: A total of 1.66m units in January, up 126.3 percent from 735,500 units a year earlier. Keeping passenger vehicles and commercial vehicles apart is a frustrating exercise in China. Minivans for instance, and of course pickups, count as commercial vehicles.

“Demand remains strong in January as many people want to get a new car for themselves and for their loved ones before the Chinese New Year,” said Zhang Xin, an analyst with Guotai Junan Securities. Chinese New Year, which officially starts on Feb. 14 this year and lasts a week, but unofficially lasts the whole month of February, is the biggest shopping season in China.

Number were slightly distorted. January 2009 had showed a decline of 7.76 percent because of the slowing economy, and because the begin of Chinese New Year fell into January last year.

By way of comparison, U.S. light vehicle sales (cars and trucks) totaled 698,990 in January – that’s less than half of China’s vehicle sales in the same period. In terms of “passenger vehicles,” Americans bought 397,131 in January. The Chinese bought more than three times as many.

2009 auto sales in China were up 45 percent. China blew by the United States and became the world’s largest car market by a wide margin. Analysts predicted more sedate growth rates of 10 to 15 percent in 2010, if only because of the higher comparative base in 2009. Chen Hong, president of SAIC, sees bigger gains, due largely to pent-up demand in smaller cities where cars are no longer a luxury item as wealth grows. Most of China’s automakers share his optimism and invest for a growth between 20 and 30 percent in 2010.

]]>http://www.thetruthaboutcars.com/2010/02/china-in-january-up-115-percent-or-126-percent/feed/6The China Syndrome: 50 Million Cars A Year?http://www.thetruthaboutcars.com/2010/02/the-china-syndrome-50-million-cars-a-year/
http://www.thetruthaboutcars.com/2010/02/the-china-syndrome-50-million-cars-a-year/#commentsFri, 05 Feb 2010 10:50:10 +0000http://www.thetruthaboutcars.com/?p=344293Yesterday, we reported that China wants to be a market of 20m cars in 2012. We didn’t predict that, just reporting the news, ma’am. A hue and cry ensued: “Can’t be!” Commentator ohsnapback, who’s forte is lawyering, a much more complex field than economics, prognosticated an immediate burst of the Chinese bubble, with a mega […]

Commentator ohsnapback, who’s forte is lawyering, a much more complex field than economics, prognosticated an immediate burst of the Chinese bubble, with a mega tonnage of more than 100 times of our housing bubble. The argument was promptly defused. After all, China doesn’t borrow money. They lend it. Mostly to the U.S.

Then, commentator ra_pro rolled out the really big ordnance: “As I said many times previously: Demography is Chinese destiny as it is Japan’s.” If people would only stop prattling on about demographics, and would check their data first.

For added spice, factor in that the last Chinese census (it was taken in 2000 and never really finished) is considered as deeply flawed.

Conservative estimates say that around 200m people are living off the books in China, more than the whole population of Japan.

A huge chunk of children have not been reported at all, wrote Daniel M. Goodkind of the U.S. Census Bureau. A correct count of births is the lifeblood of demographic projections. If you miss more than a quarter of the children born in any given year, your projections will be off by 25 percent for generations to come.

Not to worry: If China has something in abundance, then it’s people.

The population bomb turning out as a dud, the sustainability squadron was launched: “There isn’t enough space, water, air or oil to sustain Chinese expansion of 20 million cars per year for a very long time,” quoth ra_pro.

Funny, when Americans bought 17m cars a year, where were the people who said “there isn’t enough space, water, air or oil to sustain expansion of 17 million cars per year for a very long time?” Actually, that number still is a wet dream in Detroit and DC. Our own Ed Niedermeyer pointed out in the New York Times: only if the “salad days of 2000″ are bested, the tax payer will ever have a chance to get his or her money back from GM. Dream on.

Now, for the really scary part. There are more than 800 cars per thousand people in the U.S., more cars than people with drivers’ licenses. In China, there are only some 76 cars per thousand in China. In most developed countries, the number is between 500 and 600 per thousand.

So for when will we grant China the same standard of living (or at least driving) as the people in Poland? Many Chinese would object at this point. I have to go to Poland on occasion – not that I’m looking forward to it – and last time I was there, the mayor of a good sized town complained that they didn’t have the money to light the Christmas tree on central square. The local KTV in any Chinese village is an orgy of neon all year round.

420 cars per thousand, in China that comes out to a total of 550m cars on the road, if the 1.3b population is correct. Or 630m cars, if the more likely 1.5b population is right. Let’s stick with 1.3b pop and 550m cars, in order to avoid even more anxiety.

How many cars do Chinese have to buy to get to the level of Poland in a reasonable amount of time? Let’s ignore popular wisdom that Chinese cars fall apart the minute you drive them off the lot, and let’s assume a really low scrapping rate. To make calculation easy, let’s call it 500m more cars needed.

(Don’t hyperventilate. That’s only twice the number of cars on the road than in the U.S. and the U.S. has only 1/5th or so of the population of China.)

So how much time do we give China to reach the same standard of living (or driving) as Poland in 2008? 10 years? (Many Chinese would loudly object.) That’s 50m cars per year. Yes, 50,000,000.

You think that’s impossible? Ok, then let’s give the Chinese 20 years to catch up with Poland. (Many Chinese would take to the streets at this point, something the Chinese government really would not appreciate.) That’s 25m cars per year.

Still impossible?

Hint 1: Beijing, a city of 17m people, already has 4m cars. 240 cars per thousand. Poland had 265 cars per thousand in 2000. Shanghai has so many cars that the city has to limit growth by auctioning off license plates. People want to drive so badly, that they pay more for a plate in Shanghai than for some new cars. By the way: The population of Beijing and Shanghai, added together, roughly equals the population of Poland.

Hint 2: A gallon of gas of dubious quality costs $4.45 in Beijing. Using the ever so popular purchasing power conversion, it would feel more like $8. (The junior secretary, who gave me the 8 RMB/liter rate, makes $300 a month – I’m no slave driver, it’s the going rate.) And nevertheless, they are buying cars like there is no tomorrow. An unsaturated market does that.

But what about the gasoline? Ecogeek.com, a publication definitely beyond suspicion of promoting worldwide wastage, recently pointed out: “The president of China’s Innovation Center for Energy and Transportation has said that Chinese officials are drafting new mileage standards that would require an 18 percent improvement in fuel economy by 2015. New cars in China already average about 35.8 mpg and under the new rules, would be required to get 42.2 mpg by 2015. The new U.S. standards require an average mgp of 35.5 by 2016.”